Bush's success on trade cost him

Protectionists target Bush over free trade

Gary Jason

President Bush stood over U.S. products for export as he spoke about his support for free-trade agreements with Colombia, South Korea and Panama in May. John McCain and Barack Obama have different views about trade issues. Associated Press

OP-ED:

As President Bush gets ready to hitch up the wagon and take his family back to Texas, various commentators are assessing his presidency. I want to make a modest contribution to the discussion by pointing out Mr. Bush's legacy on free trade. Specifically, I would argue that his track record on this score is the best in American history.

Congress granted Mr. Bush "fast-track" authority in 2002. This gave him the power - one that other presidents have had since the 1970s - to negotiate free trade agreements (FTAs) free from congressional meddling. (Naturally, Congress still retained the power to ratify or veto any resulting agreements). Since being granted such powers, Mr. Bush has negotiated more FTAs than all his predecessors combined. He has negotiated FTAs with Australia, Bahrain, Chile, Colombia, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Morocco, Oman, Panama, Peru, Singapore and South Korea. Most of the agreements were subsequently ratified and implemented, with the Peru FTA being pushed through a reluctant Democrat-controlled Congress in late 2007.

Even more boldly, Mr. Bush pushed for a Free Trade Area of the Asia Pacific (FTAAP) at the meeting of the Asia-Pacific Economic Cooperation conference in 2007. This huge free trade zone would have included Chile, the United States and most of the other Pacific countries of the Western Hemisphere, along with China, Japan, South Korea and most other Asian nations. Given the deep divisions between the Asian nations, that was a bridge too far, but at least Mr. Bush tried it.

But the Democrats are now a very protectionist party, and the Democrat-controlled Congress stripped Mr. Bush of his fast-track authority in 2007. Since then the Democrats have successfully blocked the Colombia and the South Korea FTAs.

So, the prospects of an expansion of free trade are now bleak. A rising tide of populist sentiment saw to that. The twin bugaboos of populism are free trade and immigration. Mr. Bush tried more than any recent president to rationalize both, and it cost him support on both the left and the right. By mid-2008 polls showed that the public had come to oppose free trade, and Mr. Bush was down to 30 percent in the polls. His unwavering support of free trade cost him dearly in public support.

John McCain campaigned on a platform of free trade and had a 100 percent rating from the Cato Trade Center. He lost. Barack Obama (in exchange for the endorsement of the Teamsters' Union) came out against the Korea FTA, and he ran a campaign bashing NAFTA under the canard that it had cost millions of jobs. (He even suggested renegotiating it, before backpedaling through backchannels to the Canadian government, which was outraged at the suggestion). Mr. Obama won, and so did more congressional Democrats.

The result is the most virulently protectionist Congress since the Smoot-Hawley era, with a president clearly opposed to free trade as well. And all of them are greatly beholden to Big Labor, which spent $450 million on the 2008 elections, mainly on Democrats preaching protectionism.

The populist protectionist measures of the 1930s were a major cause of first a deeper economic slump, and then a world war which consumed 55 million souls before it ended. That protectionist outburst proved with a vengeance the observation of Frederic Bastiat, that "When goods cannot cross borders, armies will." Those nightmarish consequences brought about a bipartisan consensus supporting free trade that lasted from the 1940s through the Clinton and Bush eras. It is now gone.

The old saw has it that history repeats itself, first as tragedy and then as farce. That House Speaker Nancy Pelosi, Senate Majority Leader Harry Reid and Mr. Obama are circling the wagons to "protect" American workers (the ones in unions, that is) is nothing if not farcical. Whether this new era of protectionism brings prosperity and peace, or deepening recession and war, remains open to speculation - though history sides with the latter.

Gary Jason is a contributing editor to Liberty.